Using detailed data sourced from the USA’s Investor Responsibility Research Centre, Professor Renee Adams and co-researcher Dr Ferreira found that there could be a measurable improvement in the monitoring capacity of boards that incorporate more female directors, characterised by greater participation of directors in decision-making, tougher monitoring of the CEO, and more alignment with the interests of shareholders.

Professor Adams said the research provided empirical evidence to support what has traditionally been a largely ideological debate.

“Boards around the world are under pressure to recruit more women with some countries legislating quotas to improve diversity on boards,” Professor Adams said.

Companies in Norway are now required to ensure that at least 40 percent of directors are female. Spain too will have a similar quota of 40 per cent, coming into effect from 2015.

Professor Adams cautions that the findings do not categorically support the argument for quotas, since increased monitoring can be counter-productive in well-governed companies.

“Ultimately decisions about board composition must be made at the company level, taking into account other board characteristics.

“What our evidence does show is that women board members are not mere tokens,” Professor Adams says.

The research will be published in the Journal of Financial Economics.